Transcript

00:00:00

>> A quick tap to pay has become a way of life in China. You'll find QR codes slapped on pretty much everything here, from your local cafe to your neighborhood gym. But you may wanna look twice before using your phone to pay for a morning latte that QR code might be a fake.

00:00:19

>> I'm Reuter's Gracie in Beijing. One of the most prevalent QR code scams here, actually quite simple. Fraudsters print out their own QR codes and put it onto an already existing one like this. That way when unsuspecting customers come and scan those codes, they end up sending their money to someone who's not the vendor.

00:00:36

>> According to state media almost $50 million have been stolen in the Chinese province of Guangdong alone. Security experts say the number of scams are on the rise, and that criminals may be on the lookout for new exploits.>>

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> Now if your QR code is scanned, and your money has gone to someone else's account, it will be covered by insurance and fully compensated by our company.>> QR codes were hit in China because of the vast number of unbanked people who are able to use the online payment system without a credit history.

00:00:55

Once they get these privileges your bank account information and payment data will all be hijacked.>> The blame is usually placed on China's 2 online payment giants, Ali Pay and We Chat Pay. And the government is pushing them to prevent a potentially massive data leak. The big two say they're taking steps to lock things down.

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00:01:31

Small businesses dealing only cash preferred it to strict state run banks. And until recently these users didn't really care about privacy, the main reason why QR codes didn't off in the West. But as hackers rush to find new ways to exploit the system, the question remains just how secure these black boxes might be as China continues to race towards a cashless future.